Investors should use current volatility to position for higher US stock prices – UBS

Anil Panchal FXStreet

Global investors have been recently challenged by the volatility in the US stocks as the key benchmarks, namely DJIA and SP500, ease from the monthly top but stay above the mid-September tops.

While noting this, UBS came out with the research report suggesting further upside momentum despite expecting additional volatility in the near-term.

The note cites three reasons for its bullish bias as follows:

Whatever the outcome of the US election, we think the new stimulus will be rolled out after the vote and lift economic growth.
Successful vaccine trials will increase certainty about the economic outlook. News on COVID-19 vaccines and treatments have not all been positive.
Central bank policy is making the long-term case for equities over cash even clearer.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

EUR/USD struggles to build on recent rebound, holds above 1.1550

EUR/USD trades marginally lower on the day but manages to hold above 1.1550 in the American session, following Thursday's rebound. The pair edges down as the US Dollar rebounds slightly as investors cling to a cautious stance amid mixed headlines surrounding the conflict in the Middle East.

GBP/USD retreats below 1.3400 as USD recovers

GBP/USD stays under modest bearish pressure and trades slightly below 1.3400 in the second half of the day on Friday. The renewed USD strength doesn't allow the pair to gain traction as investors adopt a cautious stance while awaiting headlines surrounding the US-Iran war.

Gold retreats from session-high, tests $4,200

After rising more than 3% on Thursday, Gold (XAU/USD) continued to edge higher but failed to gather momentum on Friday, returning to $4,200 region in the American session. The US Dollar rebounds following the recent selloff as investors remain sceptical about a resolution in the Middle East conflict, capping XAU/USD's upside.

Pi Network: Bulls attempt comeback as bearish strength fades

Pi Network (PI) is trading at around $0.120 after a modest recovery the previous day. Despite this recent rebound, traders should be cautious as a scheduled unlock of 14.8 million PI tokens on Friday could limit the token's recovery potential by increasing market supply. Meanwhile, the technical outlook is showing early signs of fading bearish momentum, suggesting a short-term bounce.

UoM Consumer Sentiment Index expected to remain depressed near historical lows in June

The University of Michigan (UoM) will release the preliminary estimate of June’s Consumer Sentiment Index on Friday. The report is expected to show that consumers’ confidence remains depressed.

4.2% headline, 0.2% core: Why the Fed's next hike may be targeting the wrong problem

May's CPI put headline inflation at 4.2% on the year, up from 3.8% in April and the hottest reading since April 2023, while core prices rose just 0.2% on the month, undershooting the 0.3% consensus and halving April's pace.